Next year will mark a “transitional but sluggish year on the road to recovery” for the commercial construction industry, according to a forecast released today by Associated Builders and Contractors.
  “Through late 2008, the industry held up well, but 2009 was a year of retrenchment for many construction sectors, including those associated with private development and municipal projects,” said the trade group’s chief economist, Anirban Basu.
  “However, the financial crisis that began in 2007 and deteriorated significantly in September 2008 also led to the introduction of a variety of policies designed to jump start the economy, including the American Recovery and Reinvestment Act of 2009, which is now beginning to support water/sewer and road resurfacing construction projects,” said Basu, in a statement.
  “These segments are positioned to be among the big winners in 2010. Segments that are less closely aligned with federal spending are generally poised for another rough year in 2010,” he said.
  Retail, hotel and office construction spending will be off significantly next year as office vacancy rates continue to rise, hotel occupancy rates continue to fall and retail activity remains subdued, according to the forecast.
 Construction related to manufacturing will drop sharply. Institutional construction, including hospital construction, will be soft due to lower state and local spending and pressure to contain health care costs.